Analyzing the role of income inequality and political stability in environmental degradation: Evidence from South Asia

• Published in: Gondwana research Vol. 107; pp. 13 - 29
• Main Authors: Korkut Pata, Ugur, Yilanci, Veli, Hussain, Bilal, Asif Ali Naqvi, Syed
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01-07-2022
• Subjects: Ecological footprint; Income inequality; Panel data analysis; Political stability; Renewable energy; South Asian countries; NRD; PS; DH; VAR; GHG; IPS; Income inequality; FMOLS; GDP; OECD; South Asian countries; FOA; N-W; Political stability; AMG; Panel data analysis; EA; EC; ED; EE; II; PCSE; EF; EI; DPTM; GMM; IO; MIC; FGLS; IQ; ECOWAS; EP; VA; EQ; ER; IV; G-7; POP; Renewable energy; POV; DKSE; Glob; RL; SIS; FE; RQ; INF; AGRI; MNF; NR; URB; CO2; DPR; PTM; FDI; Ecological footprint; K; L; PTY; T; CSD; SRV; SO2; EKC; GE; GDP2; STIRPAT; CC; BRICS; OP; HIC; ARDL; CCF; FAA; LIC; ECF; ECI; PMG; GS; GOV; LEG; MENA; REC; DOLS; CCR; TI; VEC; CIPS; PI; EPI
• ISSN: 1342-937X; 1878-0571
• DOI: 10.1016/j.gr.2022.02.009

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•Environmental effects of political stability and income inequality.•Second-generation panel data methods are utilized for four South Asian countries.•Political stability and renewable energy improve environmental quality.•Income inequality and urbanization worsen the ecological footprint.
South Asian economies have experienced considerable growth over the last two decades, which has brought with it a number of problems. Despite the rapid growth, income inequality has increased in South Asia and political instability continues mainly due to territorial disputes between Pakistan and India. In addition to these factors, the increase in population and energy consumption has also contributed to the environmental problems in South Asia. Therefore, there is a need to analyze the role of income inequality and political stability in environmental degradation and thus take measures to prevent irreversible environmental consequences. In this background, this study examines the role of income inequality and political stability on environmental degradation in four South Asian countries (Pakistan, India, Sri Lanka, and Bangladesh). For this purpose, the study employs second-generation panel data approaches on a Stochastic Impacts by Regression on Population, Affluence, and Technology model (STIRPAT). Based on annual data for the period 2002–2016, the empirical results show that economic growth, income inequality, urbanization, and financial development increase the ecological footprint, while political stability and renewable energy utilization help to reduce environmental degradation. The findings of the panel causality test also suggest unidirectional causality from urbanization, renewable energy, economic growth, and income inequality to ecological footprint. According to these findings, ensuring political stability, reducing income inequality, and promoting renewable energy are essential policy instruments for sustainable and green development in four South Asian countries.